Whether to use bank or brokerage firm for opening a DEMAT/Trading account?

I did some research online and some people don't recommend opening DEMAT/Trading accounts with banks and instead go with a more specialized brokerage firms such as India Bulls, Kotak etc.

Are there big difference between banks and these brokerage companies, in terms of features, customer service and fee structure?

Also, which of the banks/brokerage companies have better products? Banks I am considering are SBI, ICICI and HDFC. Brokerage services - I am open any.

Thanks!

asked Jan 11 '12 at 15:30 by zeeray 1112


Most of the bank now-a-days have separate securities divisions e.g. Kotak, HDFC, ICICI etc. Actually demat account would be opened with these divisions and there won't be as such dependency on bank. Maximum benefit you can see is linked bank account and some statement displayed in bank account login.

Except ICICI and Kotak, Most of banks have smaller securities divisions with very less customer base, so I won't advise you to open demat account with these banks (e.g. SBI, HDFC).

Independent brokerage firms like Indiabulls, Religare, Reliance, IndiaInfoline and ShareKhan are pretty competitive in pricing and provide better services/support than bank's securities division. As its their bread and butter they have better teams, advisory services, mobile application and trading tools etc. Your bank account with any bank can be linked with these trading account and there won't be as such issue in transacting.

So you still want banking and securities services, I would advise ICICI and Kotak (additional cost you will have to bear in terms of annual charges and brokerage rate). Else you can choose from independent brokerage firms based on suitable pricing.

answered Jan 11 '12 at 16:03 by pankaj 5.2k320

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Thanks Pankaj. I will start with Sharekhan and see how it goes. If you have recommendations among online brokerage firms, please let me know.
(Jan 13 '12 at 14:42) zeeray
There is not much difference among these companies. It all depends on your trading frequency. If you are heavy trader, they may offer with a annual cost and low brokerage fees. But if you will trade rarely, then it make sense to get an account with minimum monthly/yearly charges.
(Jan 13 '12 at 14:51) pankaj

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Asked: Jan 11 '12 at 15:30

Seen: 3,500 times

Last updated: Feb 22 '12 at 22:34